Assets at Zurich-headquartered Julius Baer Group reached a new record of CHF 179bn in the first half, despite taking a hit of CHF 65m for a payment to Germany and CHF 14m of expenses the Swiss bank said were “related to the US tax situation”.

Swiss groups such as Julius Baer have had to make provisions for paying tax authorities in Germany and the UK, and the US, which are all trying to recover taxes citizens owe to them, from undeclared Swiss bank accounts.

The effects of this on Julius Baer did not stop the group growing total assets, investment assets and winning net new business, according to its first half results posted this morning.

The group took in net new cash of CHF 5.5bn, at an annualised rate of 6.4%, and posted an adjusted net profit of CHF 221m, up 13% on the previous period.

Assets under management increased by 5% last half, driven by the CHF 5.5bn of net new monies, CHF 2.5bn of market gains and CHF 500m of positive FX effects.

Net new business was drawn in main from growth markets – a key area for future development by the Swiss bank – as well as German private banking, and cross-border and Swiss businesses.

The group is developing its emerging markets growth by announcing a strategic partnership with Bank of China, to cross-refer clients and undertake “various joint marketing activities”.

The BOC will refer clients with international private banking needs outside China’s mainland to Julius Baer, who will refer back to BOC clients requiring banking services.

In addition, Bank of China (Suisse) SA will be integrated into Bank Julius Baer.

Boris Collardi, CEO of Julius Baer, said: “The cooperation with Bank of China will lead Julius Baer to partner with one of the top players in Chinese Mainland and internationally. In addition, in future the partnership offers the potential for Julius Baer to gain further access to the Chinese mainland, one of the world’s most important and fastest-growing wealth markets.”

Any growth for Julius Baer from the agreement will come on top of total client assets of CHF 269bn by the end of June, up 4% since January.

However clients doing less business in foreign exchange and securities transactions led operating income at the group to fall 4%, and the gross operating margin to fall by 7bps to 98bps, half on half.

Boris Collardi, CEO of Julius Baer Group, said: “Julius Baer’s growth strategy remained well on track in the first half of 2012 as evidenced by the strong net new money inflows.

“At the same time, the ongoing economic and political uncertainty, dominated by the eurozone crisis, continued to frame the market environment. Against this background, our clients maintained their overall cautious investment stance leading to relatively restrained transaction and trading activity.”

Julius Baer said its focus on costs had helped it maintain profitability, as its staff fell by 1%, year on year, to 3,649, including 801 relationship managers.

This led to a 2% decline in personnel expenses, to CHF 404m.

A reduction in the number of shares, resulting from a share buyback program completed in February, helped adjusted earnings per share improve by 19% to CHF 1.14.

In reporting on its capital base this morning, the group noted it had “no treasury exposure to Greek, Portuguese, Spanish or Irish issuers, and only marginal exposure to Italian sovereign credit.”